International labour standards contribute to development

It is said that cheap labour contributes to low productivity and a squandering of the human resource. Why, it is asked, should an enterprise try to make 'smarter' use of its human resources where it can maintain profit by simply using more (cheap) labour, in an environment which suppresses the cost of labour? Any contribution to an environment which respects and rewards the smart use of labour -- including the contribution at the national level of international labour standards -- helps develop the national human resource, improve the possibility of attracting foreign direct investment, and improve the chances of economic growth. Retention of cheap labour practices maintains the nation in a cycle of poverty which relies on low costs and low productivity for maintaining income.

The World Bank's World Development Report 1995, "Workers in an integrating world" discussed a number of international labour standards matters, pointing out the usefulness of appropriately designed standards of which many consistent with international standards. The Bank's comments with reference to the economic role of unions in this regard is noteworthy:

"Trade union activities can be conducive to higher efficiency and productivity. Unions provide their members with important services. At the plant level, unions provide workers with a collective voice. By balancing the power relationship between workers and management, unions limit employer behaviour that is arbitrary, exploitative, or retaliatory. By establishing grievance and arbitration procedures, unions reduce turnover and promote stability in the work force -- conditions which, when combined with an overall improvement in industrial relations, enhance workers' productivity."